Bloomberg

Bloomberg | Quint is a multiplatform, Indian business and financial news company. We combine Bloomberg’s global leadership in business and financial news and data, with Quintillion Media’s deep expertise in the Indian market and digital news delivery, to provide high quality business news, insights and trends for India’s sophisticated audiences.

The Most Expensive Commutes in America Aren’t in NYC or San Francisco

(Bloomberg) -- The most expensive commutes in the U.S. probably aren’t where you would imagine. The commuters who face the highest costs aren’t coming from the suburbs of New York City or San Francisco. These commuters live within 65 miles of Washington.

Workers from Charles County, in southern Maryland, spent 388 hours -- or just under two and a half weeks -- on average, traveling to and from work in 2017, according to Bloomberg analysis of U.S. Census data.

Residents in Fauquier County and Stafford County in Virginia, more than 35 miles (56 kilometers) from Washington, face similar commuting costs.

Bloomberg calculated a county resident’s opportunity cost by converting hours spent commuting into a dollar amount based on the average annual income of a full-time worker. The index also factored in the percentage of workers who commute before 6 a.m. under the assumption that leaving that early is undesirable for most and warrants a higher opportunity cost.

While the residents of these counties may decide to commute based on a variety of factors, they typically have higher incomes than the average for the region, according to Brad Hansen, an economics professor at University of Mary Washington in Fredericksburg, Va., about an hour’s drive from Washington.

“They find the jobs in D.C. and Northern Virginia more attractive, largely because of higher income, but they find living in places like Stafford, Fredericksburg and Spotsylvania more attractive because of lower housing prices or they like living in a less urban area,” Hansen wrote in an email.

Time vs. Money

How do residents determine whether the commute is worth it? They must balance the trade- off between high rents and short commutes against low rents and long commutes, according to Ferdinando Monte, an assistant professor of economics at Georgetown University.

“You would like to be close to a place that has high wages or high amenities but you don’t want to pay the high rents,” Monte said. “Rather than paying for higher rent, you can pay that in commuting time.”

Apparently, many workers taking residence in the satellite neighborhoods of San Francisco and the New York-New Jersey metro area also prefer the commute over higher rents, according to the index.

Sprawling Cities

One might ask how the counties in Virginia and Maryland ranked higher than counties outside New York City and San Francisco. One reason may be simple geography -- how easy it is for a city to sprawl out or cover a larger area, according to Monte.

For example, San Francisco is hilly and surrounded by water on three sides, which impedes sprawl, he said. The Washington area is less inhibited by such factors. Also, Congress enacted a law more than 100 years ago that limits the height of buildings within the city. This has kept the D.C. skyline low; urban sprawl has ensued.

Arlington County, Virginia, where Amazon proposed to build its expansive new headquarters, scored the lowest among the 14 largest counties in the greater Washington region. From home to work, local residents spent just shy of 30 minutes commuting -- the equivalent of 12 percent of $106,670, the average pay for a full-time worker in the county.

In 2014, the Metrorail system added four new stations in Virginia. Construction is underway for an additional six stations on an 11-mile stretch of track that will include a transfer from the Washington Dulles International Airport to downtown Washington.

The index shows some portion of Americans choose lengthy commutes but there’s an increasing number of them who work from home. Technological advancements and the rise of the "gig economy" have enabled jobs to be performed anywhere with Internet access.

To access the full data set click HERE

Methodology

The index scored 800+ counties for the highest cost of commuting based on three metrics: the cost of commuting in equivalent dollar amount, the percentage of income this matches, and the percentage of the workforce that leaves before 6:00 a.m. The three metrics are weighted at 70 percent, 20 percent and 10 percent, respectively.

The absolute cost of commuting was calculated by converting total commuter hours into a dollar amount based on the average annual income of a full-time employee in the region. The index does not include ancillary costs for transportation and parking.

To access Bloomberg’s Economic Cost of Commuting full data set, click HERE.Below are the 20 counties with the highest commuting cost: